LightSquared unleashed to sell wholesale 4G mobile broadband

Want to start your own 4G broadband retail outlet? A new company has the green …

A new contender in the communications world has received the green light to sell mobile high-speed Internet on a wholesale basis. On Wednesday the Federal Communications Commission granted LightSquared permission to open its satellite and base station networks to a wide variety of mobile broadband partners. The move introduces the prospect of new, innovative 4G services across the country, among them under-served rural areas.

LightSquared calls the application grant the "essential building block for our network as we build out to meet the rigorous construction timetable that the Commission has made a condition of our authorization."

Indeed, the company has signed on to a rollout schedule of its Long Term Evolution terrestrial service that will offer coverage to at least 100 million Americans by December 31, 2012, another 45 million by December 31, 2013, and 260 million all told by December 31, 2015.

The LightSquared vision.

Strings attached

LightSquared is the creature of mega-investor Philip Falcone, who saw gold in the company's predecessor, SkyTerra Communications. Since 1996 the latter has operated two geostationary satellites that blanket much of the western hemisphere with voice and low-speed data coverage—one licensed in the US and the other in Canada.

Satellite communications are much more expensive than terrestrial mobile. So with the FCC's blessing, Falcone's Harbinger Capital Partners investment group acquired SkyTerra, and brought in Nokia Siemen to design the LightSquared network, install equipment, and manage the operation, which will consist of about 40,000 cellular base stations covering 92 percent of the country.

Suddenly SkyTerra was transformed into a competitive player in the mobile broadband landscape, able to offer "dual mode" services (satellite and base station broadband).

The FCC attached some interesting conditions to the acquisition. Among them, Harbinger promised that SkyTerra would not enter into a deal to make its 1525 to 1660.5 MHz band spectrum available to any entity that happens to be "the largest or second largest wireless provider" in the US, without receiving prior Commission approval.

Those unnamed providers would be AT&T and Verizon, who now rake in over 60 percent of mobile wireless sector revenue, according the FCC's latest mobile competition report.

On your way, connected

So this new venture is poised to offer wholesale mobile broadband to a host of players who could operate quite independently of the big telcos. The LightSquared idea is to partner with entities that want to market their own products complete with a network to connect the devices.

"The game designer can now market his game along with the bandwidth to play it," the company's YouTube video explains. "Hospitals can create their own wireless networks. Manufacturers can sell their laptops already hooked up to high speed Internet. National mass retailers can send you on your way already connected."

There is still one more hurdle. LightSquared will have to ensure that its services don't interfere with GPS systems by organizing a "working group" with various federal agencies "to fully study the potential for overload interference to GPS devices and to identify any measures necessary to prevent harmful interference to GPS."

Matthew Lasar / Matt writes for Ars Technica about media/technology history, intellectual property, the FCC, or the Internet in general. He teaches United States history and politics at the University of California at Santa Cruz.